Integrated Business Management

• The marketing mix is the combination of product, price, promotion, and place.
• Line extension


  Development of a product closely related to one or more products in the existing product line but designed specifically to meet somewhat different customer needs
• Product modification


  Change in one or more characteristics of a product
• Quality modifications


  Changes relating to a product’s dependability and durability
• Functional modifications


  Changes affecting a product’s versatility, effectiveness, convenience, or safety
• Aesthetic modifications


  Changes to the sensory appeal of a product
• New product


  An innovative product that has never been sold by any organization
• Disruptive innovation


  Identifies old technologies that can be exploited in new ways
• New-product development process


  A seven-phase process for introducing products
• Idea generation


  Seeking product ideas that will help organizations to achieve objectives
• Screening


  Choosing the most promising ideas for further review
• Concept testing


  Seeking potential buyers’ responses to a product idea
• Business analysis


  Evaluating the potential contribution of a product idea to the firm’s sales, costs, and profits
• Breakeven analysis


  Determine how many units they would have to sell to begin making a profit
• Payback analysis


  Compute the time period required to recover the funds that would be invested in developing the new product
• Product development


  Determining if producing a product is technically feasible and cost-effective
• Test marketing


  Introducing a product on a limited basis to measure the extent to which potential customers will actually buy it
• Simulated test marketing


  Consumers at shopping centers are asked to view an advertisement for a new product, given a free sample to take home, and then subsequently interviewed over the phone or through online panels and asked to rate the product
• Commercialization


  Deciding on full-scale manufacturing and marketing plans and preparing budgets
• Marketing management


  Analyses the results of test marketing to find out what changes in the marketing mix are needed before introducing the product
• Rollout


  Products are not usually launched nationwide overnight but are introduced in stages
• Product differentiation


  Creating and designing products so customers perceive them as different from competing products
• Quality


  Characteristics of a product that allow it to perform as expected in satisfying customer needs
• Level of quality


  The amount of quality a product possesses
• Consistency of quality


  The degree to which a product has the same level of quality over time
• Product design


  How a product is conceived, planned, and produced
• Styling


  The physical appearance of a product
• Product features


  Specific design characteristics that allow a product to perform certain tasks
• Customer services


  Human or mechanical efforts or activities that add value to a product
• Product positioning


  Creating and maintaining a certain concept of a product in customers’ minds
• Product deletion


  Eliminating a product from the product mix
• Intangibility


  A service is not physical and therefore cannot be touched
• Inseparability


  Being produced and consumed at the same time
• Perishability


  The inability of unused service capacity to be stored for future use
• Heterogeneity


  Variation in quality
• Client-based relationships


  Interactions that result in satisfied customers who use a service repeatedly over time
• Customer contact


  The level of interaction between provider and customer needed to deliver the service
• Core service


  The basic service experience or commodity that a customer expects to receive
• Supplementary service


  Supports the core service and is used to differentiate the service bundle from those of competitors
• Off-peak pricing


  The practice of reducing prices of services used during slow periods in order to boost demand